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"I think it's very important for our friends, the Israelis, to have a peaceful Palestinian state living on their border. And it's very important for the Palestinian people to have a peaceful, hopeful future." So spoke George W. Bush just two days after his re-election, just exactly as news reports were leaking of Yasir Arafat's demise.

The combination of Bush's stunning new mandate and Arafat's near-death condition will lead, I predict, to (1) a quick revival of Palestinian-Israeli diplomacy after months of relative doldrums and to (2) massive dangers to Israel.

The doldrums will cease because the Bush administration views Arafat as the main impediment to achieving its vision  articulated above by the president  of achieving a "Palestine" living in harmony side-by-side with Israel. As Arafat exits the political stage, taking with him his stench of terrorism, corruption, extremism, and tyranny, Washington will jump to make its vision a reality, perhaps as soon as this Thursday, when Tony ("I have long argued that the need to revitalise the Middle East peace process is the single most pressing political challenge in our world today") Blair comes to town.

This observer expects that the president's efforts will not just fail but  like so much prior Arab-Israeli diplomacy  have a counterproductive effect. I say this for two reasons, one having to do with his own understanding of the Arab-Israeli conflict, the other having to do with the situation on the ground in the Palestinian territories.

Bush's understanding: The president's major statement of June 2002 remains the guideline to his goals vis-à-vis this conflict. In it, he outlined his vision for a "provisional" Palestinian state and called on Israel to end what he called its "settlement activity in the occupied territories." As these two steps make up the heart of the Palestinian program, the president was effectively inviting the Palestinians to behave themselves for an interval, long enough to collect these rewards, and then go back on the warpath.

Instead, the president should have told the Palestinians that they need unequivocally and permanently to accept that Israel is now and will always remain a Jewish state, plus they need to renounce violence against it. Furthermore, this change of heart must be visible in the schools, media, mosques, and political rhetoric before any discussion of benefits can begin.

But Bush did not make these demands, so, as Eli Lake has reported in the New York Sun, his approach translates into likely pressure on Israel.

Situation on the ground: There will be no successor to Yasir Arafat  he made sure of that through his endless manipulations, tricks, and schemes. Instead, this is the moment of the gunmen. Whether they fight for criminal gangs, warlords, security services, or ideological groups (like Hamas), militiamen grasping for land and treasure will dominate the Palestinian scene for months or years ahead. The sort of persons familiar from past diplomacy or from television commentaries (Mahmoud Abbas, Ahmed Qurei, et al.) lack gunmen, and so will have limited relevance going forward.

The Palestinian territories have already descended into a hellish anarchy and it circumstances will probably worsen as the strongmen struggle for power. Eventually, two of them will emerge with the ability to negotiate with the Israelis and Americans.

Note, two of them. The geographic division of the West Bank and Gaza, of only minor import until now, looms large upon Arafat's passing. As Jonathan Schanzer has suggested, whoever rules in the one unit is unlikely to gain traction in the other, making the notion of a "Palestine" that much more difficult to promote.

Two Palestines, anyone?

In conclusion, Israel has been spared from unremitting U.S. pressure during the past three years only because Arafat continued to deploy the terrorism weapon, thereby alienating the American president and aborting his diplomacy. Thanks to growing anarchy in the Palestinian territories, Israel will probably remain "lucky" for some time to come.

But this grace period will come to an end once clever and powerful Palestinian leaders realize that by holding off the violence for a decent interval, they can rely on Israel's only major ally pressuring the Jewish state into making unprecedented concessions. I doubt this will happen on George W. Bush's watch, but if it does, I foresee potentially the most severe crisis ever in U.S.-Israel relations.
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JWR contributor Daniel Pipes is director of the Middle East Forum and the author of several books, most recently, "Miniatures: Views of Islamic and Middle Eastern Politics". (Click HERE to purchase. Sales help fund JWR.).
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